The most important aspect of marketing that CMOs have to deal with amid the COVID-19 outbreak is implementing cost-optimization plans. As many as 65% of CMOs and marketing leaders report they are already bracing for moderate to significant budget cuts due to pandemic-related disruptions. In the coming months, market leaders will be examining ways to target their customers using cost-effective and efficient marketing programs that maximize ROI. A majority will leverage analytics to target customers and personalize the messaging. Personalization has a direct correlation to incremental revenue and increased conversion rates, a fact confirmed by McKinsey in recent interviews conducted with CMOs.
CMOs will need to move fast and strengthen their strategy for upcoming campaigns. They will need to examine how each customer segment is affected by the crisis and deliver campaigns quickly, constantly update product and service listings across all channels to improve customer experience, and regularly communicate health-related information and safety measures being implemented.
Transparency through communications and alerts are paramount to preserving customer relations. Companies such as JPMorgan Chase’s Wealth Division adapted its ad messaging for TV broadcast (shifting from their traditional in-person events strategy) through a video campaign produced in-house in just 10 days using real financial advisors delivering reassuring messages to their clients.
Retail CMOs are Hyper-personalizing Engagement Across Channels
An analysis of the financial crisis of 2008 shows that retailers who invested in customer experience were more resilient during recession periods, experiencing shallower downturns and quicker recovery. Given the situation, being available with the right solutions during the customer’s moments of crisis, and not carpet bombing the market with big-budget campaigns, will drive sales in the near future.
In the post-COVID-19 era, retailers will need to focus on differentiation through hyper-personalized approaches using data-driven insights to create unique experiences tailored to individual customers. Data can now be leveraged to create one-to-one personalization, targeting customers at different stages of their journey—from consideration to post-purchase—to improve outcomes.
There is good reason for retailers to invest in digital and to adopt an omni-channel strategy for marketing. E-commerce sales in apparel, department stores, and beauty products have increased by nearly 10%, on average, since the onset of the pandemic. In grocery, e-commerce penetration, which had risen from 2 to 3% before the crisis to 8 to 10% during its peak, is expected to settle at twice the previous “normal” level, at 5 to 7% by year’s end.
Use Customer Intelligence Platform (CIP) to drive targeted growth
Unique circumstances—such as the COVID-19 pandemic—often create unique opportunities. While bringing a laser focus to resuming businesses quickly, retailers must consider the need—and the opportunity in terms of ROI—this has created.
ITC Infotech’s Customer Intelligence Platform (CIP) enables retailers to effortlessly tap into the growing opportunity. CIP delivers intelligent and automated personalized experiences, conversational AI-based customer care, loyalty engagement and cost optimization. This is an outcome of leveraging data to extract behavioral insights which shape personalized customer communication and deliver value across channels.
ITC Infotech’s CIP is easy to implement and has proven ability to rapidly unlock incremental revenues. This is achieved by intelligently reducing the retail campaign cycle period from campaign design to execution.
The Platform Approach Enables a Shift from CapEx to OpEx Model
Cost optimization will be pursued more intensely in the coming months. To achieve this, an increasing number of organizations will be shifting from traditional hardware and software to SaaS (Software as a Service), seeking Opex models deployed on cloud with minimal Capex investments.
Cloud data platforms are ideal to store, integrate and manage data from various sources, to help drive insights. Growing competition and customer demand for a seamless experience are the driving factors for adoption of cloud in retail. Using cloud, retailers can target customers regardless of volumes, keep them engaged and provide better experiences across channels.
ITC Infotech’s CIP can deliver value in retail campaign management, within 6 months, using the Opex model. It enables better and faster value realization by leveraging consumer insights, optimized delivery of loyalty benefits, and helps derive higher business value. The CIP platform orchestrates an omni-channel customer journey by integrating with existing components of a retail organization such as marketing cloud used for direct marketing campaigns, digital engagement channels, and an omni-channel customer communication network through mobile-app, brick-n-mortar POS, and the web. This combined with our insight engine and a conversational chatbot has the potential to increase revenue by up to 7%.
ITC Infotech’s CIP has been producing results across implementations. A leading fashion and foods retail client could seamlessly integrate all aspects of customer touch points, loyalty, campaign and customer management. Using a data-driven analytical engine consisting of a Segmentation model and Predictive and Optimization models we were able to hyper-personalize engagement, optimize loyalty and drive contextual marketing. The platform is expected to drive a 2-5% increase in sales from loyalty personalization, 1.5% increase in sales due to churn prevention, 1% improvement in margins due to promotion optimization, and a 5% reduction in marketing costs. The platform is customized to leverage the existing investments, aligned to business priorities, integrated with the capabilities needed and can be developed incrementally based on business requirements.
Contact us to know more about our Customer Intelligence Platform for Retail.
Author -Shibani CB
Lead Consultant Data